Greece’s Public Debt to Return to 2009 Levels by 2026

Country strengthens fiscal recovery with early loan repayments

Greece’s public debt is projected to return to 2009 levels by 2026, according to the Ministry of Finance and Economy. The new draft budget anticipates a 2.4 percent economic growth rate, signaling steady progress in the country’s fiscal recovery. Officials believe this milestone will reinforce Greece’s financial credibility across European markets.

Debt-to-GDP Ratio Expected to Drop Significantly
The draft budget estimates that by 2026, public debt will stand at 359 billion euros, equivalent to 137.6 percent of GDP. This marks a decline of 7.8 percentage points compared to the 2025 projection. In 2010, when Greece entered its first bailout program due to a financial crisis, public debt was recorded at 147.8 percent of GDP.

Government Pursues Early Loan Repayments
The improvement in Greece’s debt levels is largely attributed to the government’s strategy of repaying its loans ahead of schedule. The Ministry confirmed that in December 2024, the country repaid loans amounting to 7.935 billion euros, following repayments of 5.29 billion euros in December 2023 and 2.645 billion euros in December 2022. These repayments are part of Greece’s commitment to reducing the burden from its first rescue agreement signed in 2010.

December Repayment to Reduce Loan Burden

In December 2025, Greece will proceed with another early repayment of loans worth 5.29 billion euros. These payments cover loans from the European Greek Loan Facility that carry floating interest rates. By paying off these loans early, the government aims to limit future interest costs and create room for better fiscal management.

Goal to Complete Repayment by 2031
According to the Ministry of Finance, Greece’s goal is to complete the repayment of all bilateral loans a decade earlier than their final maturity date, by 2031 at the latest. These loans make up the largest portion of the Greek public debt portfolio. The early repayment strategy is designed to reduce overall debt in both absolute terms and as a percentage of GDP.

Strengthening Market Confidence and Fiscal Stability
Officials have emphasized that early loan repayments send a positive message to international markets. By demonstrating the ability to manage its debt responsibly, Greece aims to boost investor confidence and signal that it is not simply meeting obligations but regaining full financial autonomy. The government is taking advantage of favorable international market conditions and a stable fiscal environment to achieve these results.

Benefits of Early Debt Repayments
The Ministry outlined several benefits of the early repayment plan. First, it helps reduce interest costs and limits future debt servicing expenses. Second, it strengthens Greece’s credibility with markets and rating agencies, as early repayment shows financial responsibility. Third, it reduces refinancing risks and limits exposure to global market turbulence. Lastly, it creates fiscal space, allowing for more flexibility in national budget planning and future investments.

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Outlook for Greece’s Public Debt
Based on the ministry’s plan, Greece’s public debt is projected to fall below 100 percent of GDP by 2035. This marks a historic turnaround from the levels that triggered the country’s financial crisis in 2010. With continued fiscal discipline and growth, Greece is on track to achieve a more balanced and sustainable economic future.

IMF Predicts Continued Fiscal Progress
The International Monetary Fund (IMF) has also expressed confidence in Greece’s fiscal outlook. According to IMF projections, Greece’s debt is expected to reach 125 percent of GDP by 2030, a figure lower than Italy’s. Ministry officials say this comparison highlights Greece’s steady consolidation of public finances and the positive direction of its recovery.

Path Toward Long-Term Economic Independence
Government sources note that these fiscal developments represent more than just debt reduction—they mark Greece’s journey toward long-term economic independence. The focus is not only on repaying loans but on creating a strong, self-sustaining economy capable of withstanding external shocks. This effort reflects Greece’s broader ambition to maintain growth, stability, and credibility in the post-crisis era.

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